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• NZCS Instruction TR800/A/03/5
• 3. Countervailing Duties

• Trade Remedies

• Completed Investigations

• Reassessment Investigations

• Canned Peaches: Greece, EU

• 3.1 Description
• 3.2 Rates of Duty
• 3.3 Method of Duty Calculation
• 3.4 Examples of Duty Calculations
  • Example A
  • Example B

3.1 Description

7. The duties are in the form of Non-Injurious Free-On-Board (NIFOB)¹ amounts in New Zealand Dollars (NZD), Normal Unsubsidised Price Free-On-Board (NUPFOB)² amounts in Euros (€), and ad valorem percentages. The duties are based on the lower of two rates in most circumstances.

8. In setting duties for named exporters reference prices have been set (i.e. either a NIFOB or NUPFOB) for the most common can sizes. The duty payable is calculated by deducting the Value for Duty (VFD) from the reference price.

9. Countervailing duty cannot exceed the amount of subsidy per kilogram established during the review (either €xxxx or €xxxx per kilogram), and in the case of imports from Greece, is levied first. In addition anti-dumping duty may apply to imports from Greece, if the total amount of duty payable is greater than the countervailing duty amount.

10. If a reference price does not exist for a particular exporter, an ad valorem percentage rate of duty applies. The ad valorem rates are "capped" through the use of NUPFOB reference prices, meaning that the lower of the two rates will apply.

11. For named exporters where NIFOB amounts apply, the duty is also "capped" through the use of NUPFOB reference prices.

12. For named exporters, the FOB invoiced amounts and NUPFOB amounts should be converted into NZD. The NIFOB amount must be converted to Euros before being compared with the NUPFOB and the lower of these two rates should be applied. If a NUPFOB rate applies, it should be converted to NZD and used as the reference price.

13. For "other" exporters, the duty payable is the lower of the applicable ad valorem rate (determined by applying the ad valorem rate to the VFD) and the NUPFOB reference price. This means that the duty payable using the NUPFOB must be calculated and compared to the duty calculated using the ad valorem rate to see which is the lowest.

14. The amount of countervailing duty cannot exceed €xxxx (expressed in NZD) for imports from Venus Growers, and €xxxx (expressed in NZD) for imports from all other exporters. Imports from Greece may also be subject to an anti-dumping duty but this will depend on the VFD of the imports.

15. All amounts requiring currency conversion should be converted using the applicable Customs exchange rate as at the date of import into New Zealand. Canned peaches imported from the EU are normally invoiced on an FOB basis (if the imports have been invoiced on any other basis please see Notes). When comparing various duty rates they must be in the same currency.

16. The method used to calculate the countervailing and anti-dumping duties, with worked examples is described in Sections 3.3 and 3.4.

3.2 Rates of Duty

17. The majority of canned peaches imported will fall within one of the three specified can sizes: 410g; 820g; and 3kg cans. Where the cans are not one of the specified sizes, use the closest size to determine the rate of duty.

18. The NIFOB amounts (in NZD), NUPFOB amounts (in Euros), and the ad valorem rates of duty, and the NUPFOB amounts (in Euros) that "cap" the ad valorem rates and NIFOB amounts are as follows:

Table 1: Reference Prices and Ad Valorem Rates (per kilogram)

Note: When comparing a NIFOB and NUPFOB to see which duty rate is lower you must convert the NZDNIFOB amount into Euros to compare them.

3.3 Method of Duty Calculation

19. The steps to be followed in calculating duties and a worked example are set out below and in section 3.4. Further examples are shown in section 6.

Step 1: Identify the Appropriate Rates for Comparison

20. Obtain the exporters name and can size and identify from Table 1 the appropriate NIFOB and NUPFOB, or ad valorem rates, that apply. If the country of origin is Greece, then both countervailing and anti-dumping duties may apply. For all other EU countries only countervailing duties will apply, but note the specific rates for Spain.

Step 2: Identify the Lower Rate

21. For each exporter the lower of the two given rates applies and will involve the comparison of a NIFOB and NUPFOB or an ad valorem rate and a NUPFOB. The lower of the two rates also must be assessed against the countervailing duty cap.

22. When comparing a NIFOB and NUPFOB, if the NIFOB (when converted to Euros) exceeds the NUPFOB, then the NUPFOB becomes the reference price, and it should be converted to NZD to allow the duty to be calculated.

23. When using the ad valorem rates the percentage rate needs to be applied to the VFD of the imports to determine the duty amount. For imports from Greece the two separate rates of duty (one for countervailing duty and the other for anti-dumping duty) are applied together to the VFD to give the duty amount. To calculate the duty cap, the VFD is deducted from the NUPFOB (converted to NZD) and is compared to the duty payable calculated from applying both of the percentage rates together.

Step 3: Calculate Duty Payable

24. Where reference prices apply, deduct the VFD from the appropriate lower rate as identified in step 3 to determine duty payable. If the VFD is greater than the reference price then no countervailing or anti-dumping duty will be payable. Where an ad valorem percentage rate applies, the duty payable is the amount resulting from applying the relevant percentage rate to the VFD.

Step 4: Convert the Countervailing Duty Cap to NZD

25. Convert the countervailing duty cap to NZD. This cap is €xxxx for Venus Growers Co-operative and €xxxx for all other exporters, including Manuel Garcia Campoy SA. The amount of countervailing duty cannot exceed these caps.

Step 5: Calculate the Countervailing Duty

26. Apply the countervailing duty at the lower of the capped rate or the duty payable as determined under steps 3 and 4.

Step 6: Calculate the Anti-Dumping Duty (Only for Imports from Greece)

27. If the duty payable from Step 3 is less than the capped countervailing duty amount, no anti-dumping duty will be payable. However if the total duty is greater than the capped amount in Step 4 then the countervailing duty will be levied at the capped amount and the residual amount will be levied as anti-dumping duty.

3.4 Examples of Duty Calculations

Example A

Example B

¹A NIFOB is a duty imposed at less than the margin of dumping/subsidisation and represents the free-on-board price at which imports would not cause injury to the New Zealand industry.

²A NUPFOB is a duty imposed at the full margin of dumping/subsidisation and represents the free-on-board price at which imports are not dumped/subsidised.